Primary cultured rat hepatocytes were found to resemble normal hepatocytes in their metabolism of thyroid hormones by deiodination and conjugation. These cells were used to investigate the regulation of thyroxine deiodination. Insulin was found to stimulate 5'-deiodination. Glucagon prevented the insulin effect, but did not alter deiodination in the absence of insulin. Glucose had no effect and did not alter the effect of the hormones. These findings may explain the inhibition of T4 conversion to 3,5,3'-triiodothyronine observed during fasting, and its restoration by refeeding, in the whole animal. A new synthesis for inner-ring labeled triiodothyronine has been devised.